Groups Want End to Subsidy of Electric Cars That Only Benefit the Rich

A coalition of 30 free market policy groups has delivered a clear message to Congress: Don’t expand the $7,500 federal tax credit for purchasers of electric vehicles, the vast majority of which are extremely wealthy.

On its face, the electric vehicle subsidy is “misguided as a whole,” coalition signatories said in a Wednesday letter to Rep. Kevin Brady, chairman of the powerful House Ways and Means Committee.

‘Americans can make their own decisions about how to spend their money and what cars they want to drive…’

IMAGE: mmurphy (CC) via Pixabay

But expanding it, they said, would create a “liability to taxpayers [that] is almost unlimited.”

And that’s exactly what the electric vehicle lobby is trying to accomplish ahead of upcoming congressional spending negotiations.

Currently, electric car and truck manufacturers are generously subsidized by the American taxpayer up to their first 200,000 electric vehicles produced.

According to a study by the Pacific Research Institute, 78.7 percent of the EV tax credits were received by households with an adjusted gross income of $100,000 or higher, and that more than half went to households with an AGI in excess of $200,000.

The justification for the taxpayer handout was to spur innovation and encourage companies to offer electric vehicle options.

Now, there’s a push to eliminate the 200,000 vehicle cap, effectively making the subsidy unlimited and permanent.

Judging by polls, voters want nothing to do with the government forcing electric vehicles on the public through manipulative tax gimmicks.

In their letter, the free market groups pointed to one poll showing that 72 percent of voters didn’t even trust the federal government to make competent decisions about electric car subsidies.

Perhaps it’s because the whole point of electric vehicles being healthier for the environment is in question, according to studies highlighting how the electricity used to generate EV use, is primarily coal and natural gas.

But the real kicker outlined in the letter is that electric vehicles, even with billions in taxpayer support, are typically too expensive for poor and middle class consumers.

“The electric vehicle tax credit subsidizes expensive vehicles that only a fraction of wealthy Americans want and that do not necessarily pollute less than modern internal combustion engines,” said Thomas J. Pyle, president of the American Energy Alliance, the first organization in the Brady letter.

“Why should a typical middle class American family — with a median annual income of $44,000 — subsidize the lifestyles of the rich and famous? Political leaders should recognize that Americans can make their own decisions about how to spend their money and what cars they want to drive. We shouldn’t give handouts to wealthy individuals to help defray the cost of their luxury vehicles,” Pyle said.